PR COMMISSIONER OF INCOME TAX JAIPUR-II vs. SHRI OM PRAKASH DANGAYACH

HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR D.B. Income Tax Appeal No. 124/2018 1. Pr. Commissioner Of Income Tax , Jaipur-II, Jaipur Raj. ----Appellant Versus 2. Shri Om Prakash Dangayach, C-18, Takhteshahi Road , J.l.N. Marg, Jaipur Raj. ----Respondent For Appellant(s) : Mr. Prateek Kedawat for Mr. R.B. Mathur HON'BLE MR. JUSTICE KALPESH SATYENDRA JHAVERI HON'BLE MR. JUSTICE VIJAY KUMAR VYAS Judgment 03/07/2018 1. By way of this appeal, the appellant has assailed the judgment and order of the Tribunal whereby Tribunal has partly allowed the appeal of the assessee for statistical purposes and dismissed the appeal of the department. 2. Counsel for the appellant has framed following substantial questions of law:- 1. Whether on the facts and in the circumstances of the case and in law, the ITAT is justified in deletion of disallowance made u/s 40(a)(ia) by holding that the provisions of section 40(a)(ia) as amended by the Finance Act, 2012 w.e.f. 1.4.2013 r.w.s 201(1) are of clarificatory

nature

and,

therefore retrospective in nature, without appreciating the fact that the relevant portion of the Memorandum explaining the provisions in Finance Bill, 2012 clearly states that this

(2 of 3) [ITA-124/2018] amendment is to take effect from 1.4.2013 and will, accordingly, apply in relation to the A.Y. 2013-14 and subsequent years. 2. Whether on the facts and in the circumstances of the case and in law, the ITAT is justified in law in holding the amendment in provision of section 40(a)(ia) as retrospective despite of no such intention of the legislature. 3. The facts of the case are that the case of the assessee was reopened for assessment and the assessment u/s 143(3) read with section 148 of the Income Tax Act, 1961 was framed vide order dt. 6.12.2012. While framing the assessment, the AO found that the assessee had made interest payment of M/s. Indiabulls of Rs.65,65,047/- and M/s. Reliance Capital Ltd. of Rs.77,37,237/- and the assessee has not deducted tax as per section 194A of the Act thereby he made disallowance of expenditure by invoking the provisions of section 40(a)(ia) of the Act and added a sum of Rs.1,43,02,284/-. 4. Taking into consideration the observations made by the Tribunal which reads as under:- 6. The only effective ground is against restricting the disallowance of Rs.65,65,047/- as

against

the

disallowance

of Rs.1,43,02,284/- made by the AO by invoking the provisions of section 40(a)(ia) of the Act. The ld. D/R supported the order of the AO and submitted that the ld. CIT(A) was not justified in deleting the disallowance. 6.1 Per contra, the ld. counsel for the assessee supported the order of the ld. CIT(A) and submitted that the ld. CIT(A) has following the binding precedent.

(3 of 3) [ITA-124/2018] 5. In that view of the matter, we are in complete agreement with the view taken by the tribunal, therefore, no substantial question of law arises. 6. Hence, the appeal stands dismissed. (VIJAY KUMAR VYAS),J (K.S. JHAVERI),J Brijesh 13.